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  • 2018 State of the Inner City Report: Green Light Go...Improving Transportation Equity December 7, 2018
    Getting to doctors appointments, going to school, to work, attending social engagments, picking up groceries and even going to the beach should all affordable and accessible.? Check out Ellen Smirl's reserach on transportation equity in Winnipeg in this year's State of the Inner City Report!
    Canadian Centre for Policy Alternatives
  • Inclusionary housing in a slow-growth city like Winnipeg December 3, 2018
    In Winnipeg, there is a need for more affordable housing, as 21 percent of households (64,065 households) are living in unaffordable housing--according to CMHC's definition of spending more than 30 percent of income on shelter.? This report examines to case studies in two American cities and how their experience could help shape an Inclusionary Housing […]
    Canadian Centre for Policy Alternatives
  • True, Lasting Reconciliation November 21, 2018
    For the first time, a report outlines what implementation of the United Nations Declaration on the Rights of Indigenous Peoples could and should look like at the provincial level. This report focuses on implementation in BC law, policy and practices. Fundamental to the UN Declaration is an understanding that government must move from a “duty […]
    Canadian Centre for Policy Alternatives
  • Boom, Bust and Consolidation November 9, 2018
    The five largest bitumen-extractive corporations in Canada?control 79.3 per cent of Canada’s productive capacity of bitumen. The Big Five—Suncor Energy, Canadian Natural Resources Limited (CNRL), Cenovus Energy, Imperial Oil and Husky Energy—collectively control 90 per cent of existing bitumen upgrading capacity and are positioned to dominate Canada’s future oil sands development. In a sense they […]
    Canadian Centre for Policy Alternatives
  • A new Director for CCPA's BC Office: Message from Mary Childs, Board Chair October 24, 2018
    The CCPA-BC Board of Directors is delighted to share the news that Shannon Daub will be the next BC Director of the Canadian Centre for Policy Alternatives. Last spring, Seth Klein announced that, after 22 years, he would be stepping down as founding Director of the CCPA-BC at the end of 2018. The CCPA-BC’s board […]
    Canadian Centre for Policy Alternatives
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The Progressive Economics Forum

Prices Decline Yet Again

Statistics Canada reported today that, for a third consecutive month, consumer prices declined and the inflation rate fell below 2%. In July, the inflation rate was 1.3% and the Bank of Canadaa€?s core rate was 1.7%.

Gasoline and natural gas prices, which have been lower this summer than last, dragged down the overall Consumer Price Index. However, there is little indication of inflationary pressure anywhere.

Even those categories with the largest price increases were in line with the Bank of Canadaa€?s 2% target. Food prices and household expenses rose 2.1% over the past year. The inflation rate for services was 2%.

With inflation subdued, there is no pressure for the central bank to raise interest rates. Indeed, the Bank of Canada could intervene to bring the overvalued exchange rate down to more competitive levels
without stoking significant inflation.

Low interest rates and low inflation create an ideal environment for public investment. Governments can finance long-term infrastructure spending very cheaply. Such investment would contribute to economic growth and employment without imposing discernable cost pressure on the wider economy.

UPDATE (August 18): Quoted in todaya€?s Toronto Star (page B5), Montreal Gazette (page C3), Waterloo Region Record (page D2), Victoria Times Colonist (page B5), Regina Leader-Post (page B1), Guelph Mercury (page B7), Cape Breton Post (page A9) and Truro Daily News (page A7).

Enjoy and share:

Comments

Comment from Angella MacEwen
Time: August 17, 2012, 12:06 pm

Public infrastructure spending that pays for itself in the medium term & improves private sector productivity? Affordable, accessible, quality childcare. Let’s do that.

Comment from Larry Kazdan
Time: August 17, 2012, 1:04 pm

Modern Monetary Theory – Bill Mitchell

“government spending is independent of borrowing, with the latter best thought of as coming after spending”

http://modernmoney.wordpress.com/tag/deficit-spending-101/

Comment from Thomas Bergbusch
Time: August 17, 2012, 10:07 pm

@Larry Kazdan:

Good point, but Erin wrote “Governments (plural) can finance long-term infrastructure spending very cheaply.” Clearly he talking about provincial, territorial and municipal governments as well, not just the currency issuer.

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